2015: The Year Of The Innovative Service Offering

As consumer spending and retail confidence continues to increase from previous years, retailers need to step-up and innovate to give consumers the experience they’re increasingly demanding. They need to ask themselves how they can improve the consumer experience and challenge conventional service offerings. IBM recently released the Australian edition of its global consumer trends study that revealed a widening disconnect between shoppers and retailers on what is considered an acceptable shopping experience. Clearly, this holiday season represents a big opportunity for retailers to innovate and create seamless experiences across all channels of engagement. However, while we’re seeing some headway, more needs to be done.

As consumers use technology in all aspects of their lives more, brands and especially retailers, need to jump on this trend and incorporate it into the shopping experience to provide the ‘connected store’ offering. Most importantly, it will heighten consumer experience, boost brand reputation and increase competition. However, as a result, this will generate more data about the customer and their behaviours, which means more focus will need to be taken on security. At Nuance, we see voice biometrics as the solution that will marry the two and provide retailers with a converged and secure shopping experience through mobiles or m-commerce, to make brands standout.

Technology is a major part of consumers’ everyday lives in Australia. Smartphone penetration is at 81 per cent, making us one of the most connected countries in the world . Ernst and Young’s Digital Australia: State of the Nation 2014 report has even dubbed 2014 as the year of the smartphone. In particular, we are embracing these new technologies and innovation in the retail sector; including mobile shopping, social networking and the uptake of self-service checkouts. In turn, it is driving consumers to demand seamless experiences across all touchpoints and deliver a level of customer service we all now expect. With consumers experimenting more with their phones, retailers now need to explore how they can also diversify their business from a device experience to a user centric solution and capitalise on the ‘next big thing’.

The financial sector is one industry at the forefront of using technology to increase the customer experience. Increasingly, we’ll see more retailers take the lead from financial institutions; particularly in regards to innovation in the payment landscape, in an attempt to shake up these experiences. Already we’re seeing ANZ’s FastPay app and Westpac New Zealand’s mobile payment sticker, PayTag, easily enable global payments through mobile devices. These services are spicing up what consumers today expect from the brands they engage with across all parts of their lives.

Convenience is key to the customer experience

Given that our mobile phones are at the centre of our hub and we all carry our smartphones with us, in retail, we see the direction heading towards one-touch purchases in-store. At the moment, we are only seeing the convergence of mobile and physical retail experiences. But, there’s a huge opportunity for retailers to amplify this further and create a seamless transition between online and offline to create a more personalised, relevant in-store offering through m-commerce. One example is NFC, which is built in to most Android smartphones and Apple’s iPhone 6, and means users can swipe their smartphones over a compatible merchant terminal at point of sale to help automate and manage payment processes. While these concepts aren’t new per se, at Nuance we see this natural progression going one step further with voice biometrics.

With microphones already built in to every smartphone device, voice biometrics accessibility is now available anywhere, anytime. In addition, retailers don’t need to worry about deploying or implementing expensive hardware for eye readers, facial readers or even fingerprint technology, which become redundant due to the existing technology built in to smartphones. It also overcomes the issue of installing authentication systems as voiceprints are unique. By tapping into everyday habits like mobile phone usage, mixed in with ease of use technology like voice biometrics, retailers not only improve Australia’s digital offerings, but also actively build up consumer relationships by offering greater choice and flexibility.

Realising tomorrow’s possibilities for retailers today

Retailers are already experimenting with different elements to provide a seamless experience through smartphones, and while these aren’t with voice biometrics yet, the experiences will pave the way in creating a seamless omnichannel experiences. Coles is a great example of this evolution, innovating with its Mobile Wallet in conjunction with MasterCard to allow customers to purchase products at the register with a tap of their mobile phones. However, voice biometrics, through smartphones, will enable experiences that extend past the transaction stage.

We’ll see consumers put pressure on retailers to have experiences that will not only exchange card information, but also automatically start a transaction through voice command interactions. For example, m-commerce will see consumers use their voice to authenticate and process purchases on their phone. They will be able to specify through voice commands whether their purchases will get delivered to an address or if they want to pick it up at store. We will eventually see this become an autonomous process, with pick-up locations allowing consumers to collect items without having to get the attention of the sales associate. This means staff can instead focus on providing quality face time with shoppers. Furthermore, with retailers now being able to verify and authenticate individual shoppers, this opens up a whole new realm of customising the shopping experience. For example, if a consumer is trying to locate the shoe department in David Jones, the technology will recognise the customer’s profile and if the person is a frequent purchaser, it will direct them to a particular brand or location, plus let them know about current sales offers.

Improving the experience for consumers has security at its core

With improved experiences that increase the level of data collected, retailers need to also prioritise security. We’ve seen the industry-wide move to phase-out signatures and expand the PIN at the point of sale (POS) terminals, initiated from banks and card companies in an attempt to increase security and crack down on fraud. However, extensive research shows knowledge-based security is easily compromised. The four-digit PIN is one of the weakest credentials, as it’s often shared and a brute force attack can quickly compromise it without any knowledge of the legitimate account holder.

Instead, voice biometrics authenticate consumers through natural voice patterns, not robotic PINs, or passwords. Imagine going through a store and telling your phone to start processing a payment for the jacket you saw on level 2 without having to answer a series of intrusive questions or providing a physical credit card to staff at a checkout. It’s a step up in security especially because voice biometrics cannot be compromised in the same way pins or signatures can be. Because a voiceprint is a hashed string of numbers and characters, a compromised voiceprint has no value to a hacker. Not only that, but each time a fraudster speaks within a call centre or mobile app, they leave behind their own voiceprint that can be used to proactively keep them out of the system and even alert law enforcement. It’s also a brand new user experience that gives consumers the freedom to speak, allowing them to be themselves through natural conversation.

Consumers will no longer need to answer intrusive security questions or remember 20+ passwords in order to verify their identity. Or have the embarrassment of forgetting their password and being denied access to services. Even the current trend of putting all your passwords in a single app, secured by a single password is one intrusion away in completely comprising a person’s whole financial portfolio. Biometrics, and the ease of voice, makes ID theft infinitely more difficult while engaging the consumer in a mobile-centric world.

M-Commerce leading the digital economy

Voice biometrics, along with the penetration of smartphones, will see m-commerce play a dominant role in consumer spending. It will extend past e-commerce and other online retail environments to provide security and customisation, but also to transform the way we engage and transact. It’ll reduce the effort to purchase and evolve with the needs of the customer. Businesses that invest in voice biometric capabilities will fundamentally change the customer experience for the better over the next decade.

The possibilities for retailers are enormous, especially considering the ease of which voice biometrics can be deployed. Think about it, we all carry the one device required to implement voice biometrics – our mobile phone. With the ability to easily and efficiently verify a customer, retailers can now truly create personalised experiences through a variety of tools like mobile apps and the customer’s own personal devices. With voice biometrics innovating customer service, businesses will be able to create safe and secure experience that will improve customer satisfaction. There is a huge opportunity for Australian retailers to provide better connectivity and deliver a seamless omnichannel experience to become retail brands of tomorrow.

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